This Week Will Separate the Men from the Boys

15.11.2016 • Investing

From Felipe Miranda – Daily Pro (Brazil) –

“You can’t feel it, you can’t see it, but I have to tell you, my friend”: (Velha Roupa Colorida by Belchior)

These times will separate the men from the boys. Oh, and the women from the girls, too – to be politically correct.  It’s always good to make that very clear.

In the last 72 hours, I stopped being an economist and have taken on the role of psychologist.  Normally my mailbox is full of emails with technical questions about stocks, bonds, and general portfolio allocations.  The last few days, all rationality has gone out the window and been replaced by heightened emotions.  Given the sudden big swings in the market, I can understand your anxiety.

I admit that it is easier for me to prescribe a quick read, like a quarterly report, than to prescribe Lorazepam.

Those of us who have lived through the most recent Bull market discovered, that as incredible as it may seem, the difficulty with (variable income) stocks is that … well, they vary.  So far so good. When it really gets ugly is the moment people realize that fixed income investments also vary, and sometimes they vary a lot. You take a look at your statement and see that your NTN-B long-term bonds (government bonds) fell a 3% in one day. You freak out. No judgment here – I get it.

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